If a household's income declines, then its budget line is

Question

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When a household's income declines, its budget line shifts parallel but closer to the origin because it can now afford fewer goods and services at every possible price. This results in a lower intercept on each axis, indicating a smaller quantity of each good that can be purchased. However, the slope of the budget line remains the same because the relative prices of goods and services have not changed.

If a Household's Income Declines, Then Its Budget Line Is